Toshiba hit with record fine over accounting scandal

The Japanese Securities and Exchange Surveillance Commission has recommended a ¥7.37 billion (£39.5 million) fine for Toshiba's earnings falsification, the highest amount it has ever sought.

Toshiba hit the headlines in the worst possible way this year when the company has found to have padded profits in order to appear more closely competitive with rival Hitachi. Stretching over a minimum five-year period, the fraud is believed to have seen profits overstated to the tune ¥200 billion (around £1.04 billion) and covers the tenure of three company presidents: Hisao Tanaka, Norio Sasaki, and Atsutoshi Nishida. Despite a major executive shake-up, many of those involved in the scandal remain in positions of power at the company - though it has stated they will be 'punished' for their actions.

The Japanese Securities and Exchange Surveillance Commission, which was conducting a review of the company's activities with regard to the claims of fraudulent reporting, has issued a recommendation: the biggest fine it has ever sought. According to The Washington Post, the Commission is seeking ¥7.37 billion (£39.5 million) from the company. For Toshiba, which has seen its share price tank since the story broke, it's bad news tempered only by its relativity: the company had set aside ¥8.4 billion to cover possible fines as a result of the probe.

Toshiba has confirmed that it will issue a restructuring plan, which may include exiting from one or more less profitable markets, by the end of the year, and will not be paying performance-linked bonuses to any executives for the last financial year. The company has not yet indicated how the restructuring may impact its computing and storage businesses.